Analyst optimistic about GM plant



A union leader hopes bargaining for the plant's future begins next month.
By DON SHILLING
VINDICATOR BUSINESS EDITOR
The odds of survival look good for Lordstown's car plant, an industry analyst said.
David Cole, director of the Center for Automotive Research in Ann Arbor, Mich., said he expects union officials to be innovative and work hard at finding a way to keep the plant open as production of the Chevrolet Cobalt is scheduled to end in midyear 2009.
"My bet would be on Lordstown," he said.
Years ago, he wouldn't have had that faith in Lordstown, he said. But the plant showed a new spirit of labor-management cooperation in winning the Cobalt in 2002, he said.
When told that local union officials are concerned the plant would not be selected for GM's next small car, Cole said that's good news. The worst thing would be for union officials to think they've already done enough, he said.
"There's good reason to think something will end up in that plant, but it won't be automatic. It's going to take a lot of hard work," Cole said.
Word that GM is considering closing Lordstown came out this week when Local 1112 leaders told its members that they have been talking with national UAW leaders about the future of the plant. A senior UAW official in Detroit has said the plant is "very vulnerable" to closure because GM is losing money on the Cobalt.
The challenge ahead
Jim Graham, president of United Auto Workers Local 1112 at the plant, said the union knows it is in competition with other plants.
"We know we have work to do. I'm very confident that our membership knows what's at stake. I'm very confident the bargaining committee knows what's at stake. We're going to get this thing done," he said.
He's hoping bargaining on the changes GM wants made to the labor contract will begin in January.
Graham said GM is looking to make the plant more productive and efficient but he didn't want to go into specifics. He added, however, that GM may want bigger changes at Lordstown than at other plants because it produces small cars, which are hard to make money on.
Tom Mock, a plant spokesman, also declined to talk about specifics but said the union and plant officials will work together to try to keep the plant open, just like they did for the Cobalt.
"We've been through this before," he said.
Job reductions possible
Cole said he expects GM will push for more outsourcing of work to suppliers and fewer job classifications in the plant. Both of those would reduce union jobs at the plant.
Domestic automakers are trying to reduce the number of skilled trades workers they have by changing union rules to allow them to do multiple jobs, he said. Nonunion plants run by foreign automakers have far fewer skilled trades workers, he said.
With the age of the work force at Lordstown, perhaps this could be done mostly through retirements, he said.
The size of the hourly work force at Lordstown has declined rapidly as GM has made productivity improvements and installed more automation.
The assembly and fabrication plants employed 9,900 in 1995 when they produced the Chevrolet Cavalier and Pontiac Sunfire. After 1,600 workers accepted buyouts and early retirements this year, the work force was cut to 3,700.
Investment in plant
Besides the labor-management cooperation at Lordstown, another factor in the plant's favor is the investment that GM has in the plant, Cole said. GM spent 1 billion to prepare the plant for the Cobalt.
Still, GM will want the plant to become more productive and will point to money-saving measures adopted at other UAW plants, Cole said.
Cole said GM could select Mexico as a production site for a new small car in order to save on wages, but it would have the expense of building a new plant.
He said he doubted GM would choose an overseas location for a high-volume small car like the Cobalt because of expense of shipping.
shilling@vindy.com